Could this Fall's Lumia Windows Phone 8 Launch Be the Last Chance for Nokia?
There's been plenty of good news about Windows Phone recently, but some analysts warn that unless the Lumia line of Nokia Windows Phone 8 devices takes off this fall, it could have serious consequences, including the end of Nokia.
That's the warning in an article from Reuters, titled "Nokia, Microsoft head for "Last Chance Saloon." Here's what the article says:
If the new [Windows Phone 8] Lumia phones do not appeal to consumers when they are unveiled next Wednesday, it could mean the end for Nokia, and a serious blow to Microsoft's attempts to regain its footing in the mobile market, analysts and investors said.
The article quotes Canaccord Genuity analyst Michael Walkley as saying:
"This is very high stakes. Nokia bet everything on Windows, and if this doesn't succeed the next step might be having to do what's best for shareholders, and that might include selling off key assets or selling the whole company."
As for Microsoft, Windows Phone still can't gain traction, and has an insignificant market share -- 3.5% according to IDC, and 3.2% according to Canalys.
Despite that meager market share, there have been good signs for the future of Windows Phone, though. Verizon, AT&T and T-Mobile will all carry new Windows Phone 8 devices when Windows 8 launches. The carriers are looking to use Windows Phone as a way to fight against Apple's demands for high subsidies and royalties for the iPhone, with royalties alone as much as $600 per iPhone user.
And Apple's patent win over Samsung means that manufacturers will be looking to Windows Phone more because Microsoft has a deal with Apple in which Apple has agreed not to sue Microsoft over mobile patents.
Because of that, Microsoft's future won't depend on Windows Phone devices from a single manufacturer. So Nokia has much more at risk this fall than does Microsoft. It's true that Nokia could be broken up or sold off if things don't improve. But that won't necessarily be a bad thing for Microsoft, because Microsoft could decide to buy Nokia. As Microsoft's decision to build Windows 8 Surface tablets shows, Microsoft may well be willing to jump with both feet into the hardware business.
Preston Gralla is a contributing editor for Computerworld, and the author of more than 40 books, including "How the Internet Works," "Windows XP Hacks," and "Windows Vista in a Nutshell" and "NOOK Tablet: The Missing Manual." You can follow him on Twitter or Google+.